Berkshire Hathaway Investment Enables Staminier to Acquire Affordable Homes Business

LONDON--()--Further to Staminier’s announcement of 22nd May 2019 in relation to the issuing of Staminier Convertible loan notes in exchange for Berkshire Hathaway shares, the Board of Staminier (“the Board”) is pleased to announce that it is has established a new subsidiary, Eco-Space 41 Ltd (“ES41” or “the Company”) in order to acquire the business and assets of a low cost, fast build and energy efficient house building business. As part of the same transaction It is also acquiring an associated company that owns a fully complete Show House built on the BRE campus site in Watford that has been tested to ensure compliance with UK Building Regulations. An ES41 Home of this kind can be built in just 41 days, is significantly cheaper than traditional build and more energy efficient than conventional homes. The Company can produce homes (both flats and houses) to pretty much any design that developers wish.

In addition as part of the transaction an exclusive 5 year contract with Shanghai Steelfashion Industrial Co Ltd of China has been given to ES41. This includes supplying materials and housing units with lead production times of 8 weeks for up to 400 houses or 600 flats. . The Company therefore believes it can increase the build capacity of ES41 to an initial 750 homes per annum, with the intention to scale up further in due course.

There is a major shortage of affordable homes in the UK at the moment, and the Board believe that the Company can play a meaningful role in helping to address that shortage.

The main target market for ES41 is the three bedroom affordable home, which can be built for developers at between £100,000 and £115,000 depending on the specification of finish, and are expected to generate a margin for the Company after all labour and materials of approximately £15,000 each. The Board is aware that the need for these Homes is not restricted to the UK and the product has already generated interest internationally.

Key terms of the transaction are as follows:

The vendors will receive 49% of the issued share capital of ES41 in return for the Show House, the interest in the Development Vehicle, the Workflow, the exclusive contract with Shanghai Steelfashion and the other business assets.

Staminier will be granted a four-year option to acquire this 49% interest in ES41 for £750,000 in cash.

The vendors will also receive a performance related earn out of £1 for each £1 of net pre tax profit that ES41 generates over the next four years. At the option of Staminier, this will be settled either by (a) the issue to the vendors of new Staminier Shares at a price of 25p per Staminier Share (against the last closing price of 16p) or (b) the payment to the vendors of a maximum of 5m Staminier Shares to be issued at 25p per share with the balance payable in cash. Therefore, in the event that ES41 generated £5m of net pre-tax profit, Staminier could elect to settle the earn out by issuing to the Vendors 20m Staminier Shares (being £5m at 25p per share), or issue to the Vendors 5m Staminier Shares (£1.25m at 25p per share), plus £3.75m cash from the profits generated by ES41. This represents an attractive purchase price of less than 2 times earnings.

To find out more about Staminier, link here https://discord.gg/rAxnWEH. For the full

announcement see www.staminier.com/news/ and https://staminier.com/latest-share-price/

Telephone: 020 7268 4928 and for more information on EcoSpace 41 visit www.ecospace41.com

Contacts

Tim Stanton
Telephone: 020 7268 4928
tim.stanton@staminier.com

Release Summary

Berkshire Hathaway investment enables Staminier to acquire Affordable Homes business

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Contacts

Tim Stanton
Telephone: 020 7268 4928
tim.stanton@staminier.com